Business Strategies in Internationalisation Outcomes among SMEs

Abstract

Innovativeness- and quality-focused business strategies have been found to determine international success of rapidly internationalizing firms known as born globals. However, it remains unclear if these strategies are also applicable in the context of internationalizing SMEs in general. In this study, we examine how two business strategies, “unique product development” and “quality focus”, determine internationalization outcomes among SMEs. By applying a cross-sectional sample of 119 internationally operating Finnish SMEs collected in 2008, we find that 1) unique product development is a differentiating factor between born globals and other SMEs, and is linked to increased turnover growth at the start of internationalization, 2) the quality focus has no such effects, and 3) neither of the focal strategies are linked to increased international performance. We further consider the implications of these results, which in part align with, and in part are contrary to those found in the born global context.